Final Results
THE AIM DISTRIBUTION TRUST PLC
FINAL RESULTS FOR THE YEAR ENDED 31 MARCH 2008
FINANCIAL HIGHLIGHTS
2008 2007
pence pence
Net asset value (per share) 50.3 64.1
Cumulative distributions paid since launch 55.8 53.8
Total return (net asset value plus cumulative 106.1 117.9
distributions paid)
Interim distribution paid (per share) 2.0 2.0
CHAIRMAN'S STATEMENT
I present the Report and Accounts for the year ended 31 March 2008.
The second half of the year under review has seen a sharp
deterioration in market conditions, with small AIM-quoted companies
faring worst than most. This has impacted heavily on your Company's
Net Asset Value.
Net Asset Value
At 31 March 2008, the Net Asset Value per share ("NAV") stood at
50.3p. This represents a decrease of 11.8p or 18.4% since the
previous year end (after adjusting for the 2p dividend paid in March
2008). The change in conditions is highlighted by the fact the there
was a rise in NAV of 1.2p per share in the first half of the year but
a fall of 12.3p in the second six months.
VCT investments
The Company made several additions to its portfolio this year,
investing £465,000 into three new investments, £300,000 into two
follow-on investments and re-invested £621,000 in two companies
following corporate reconstructions.
At the year end the Company held a portfolio consisting of 40
investments which were valued at £5.1 million. The portfolio
generated unrealised losses of £1.8 million and realised gains of
£269,000 over the year.
Details of the Company's VCT investments, including additions,
disposals and performance, are set out within the Investment
Manager's Report and Review of Investments.
Results and Dividend
The loss on ordinary activities after taxation was £1,654,000 (2007:
£786,000), comprising a revenue profit of £26,000 and a capital loss
of £1,680,000.
An interim dividend of 2p per share (2007: 2p per share) was paid on
28 March 2008. The Directors are not proposing to declare any
further dividends in respect of the year to 31 March 2008.
Listed fixed income and other investments
The Company holds a non-qualifying portfolio which includes a holding
in a fixed income bond and holdings in three hedge funds (purchased
in the year for £1.1 million). The portfolio had a value of £1.7
million at the year end and represented an unrealised loss of £75,000
at the year end.
Share buybacks
In order to provide liquidity in the Company's shares, in line with
common practice for VCTs, the Company operates a policy of buying its
own shares when they become available in the market for cancellation.
The Board used this power to acquire an aggregate of 617,802 shares
during the year at an average price of 55.7p per share, which was
generally a 10% discount to the latest published NAV. These shares
were subsequently cancelled.
A Special Resolution to continue with this policy is proposed for the
forthcoming AGM and therefore the Board recommends Shareholders vote
for resolution 6.
Articles of Association
At the forthcoming AGM, the Board will seek Shareholder approval to
update the Company's Articles of Association. Resolution 7, which is
a special resolution, proposes the adoption of new Articles of
Association which incorporate a number of changes which are required
as a result of the implementation of the Companies Act 2006. An
explanation of the proposed changes is provided within the Report of
the Directors.
The Board recommends that Shareholders vote for resolution 7 as, in
the Board's opinion, the resolution is in the best interests of
Shareholders.
Annual General Meeting
The Annual General Meeting of the Company will be held at 159 New
Bond Street, London W1Y 9PA at 12 noon on 11 September 2008.
Two special resolutions are being proposed at the meeting to renew
the authority to allow the Company to make market purchases of the
Company's shares and to update the Articles of Association, both as
described above.
Outlook
The outlook for the economy in the short term looks uncertain. It
appears that there has already been a significant downward adjustment
to prices of small- AIM-quoted companies, and it is possible that the
Company may already have felt the greatest impact of the downturn.
However the timing of any recovery is uncertain at this time.
The recent performance of the Company's AIM investments and the
consistently high level of share buybacks undertaken have contributed
to a significant reduction in the absolute size of the Company. With
lower net assets of less than £7 million, running costs may start to
become a significant burden. The Board is, therefore, keeping future
strategy under review.
Sir Aubrey Brocklebank
Chairman
INCOME STATEMENT
for the year ended 31 March 2008
Year ended 31 March 2008 Year ended 31 March 2007
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Income 218 - 218 220 - 220
Losses on - (1,574) (1,574) - (686) (686)
investments
218 (1,574) (1,356) 220 (686) (466)
Investment (34) (100) (134) (39) (118) (157)
management fees
Other expenses (158) (6) (164) (163) - (163)
Return on 26 (1,680) (1,654) 18 (804) (786)
ordinary
activities before
tax
Tax on ordinary - - - - - -
activities
Return 26 (1,680) (1,654) 18 (804) (786)
attributable to
equity
shareholders
Basic and diluted 0.2p (12.0p) (11.8p) 0.1p (5.3p) (5.2p)
return per share
The revenue and capital movements in the year relate to continuing
operations. The total column within the Income Statement represents
the profit and loss account of the Company.
A Statement of Total Recognised Gains and Losses has not been
prepared as all gains and losses are recognised within the Income
Statement as noted above.
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
for the year ended 31 March 2008
Year ended Year ended
31 March 2008 31 March 2007
£'000 £'000
Opening shareholders' funds 9,108 11,602
Purchase of own shares (346) (1,421)
Total recognised losses for the year (1,654) (786)
Distributions paid (276) (287)
Closing shareholders' funds 6,832 9,108
BALANCE SHEET
at 31 March 2008
2008 2007
£'000 £'000 £'000 £'000
Fixed assets
Investments 6,749 7,848
Current assets
Debtors 191 276
Cash at bank and in hand 42 1,153
233 1,429
Creditors: amounts falling due
within one year (150) (169)
Net current assets 83 1,260
Net assets 6,832 9,108
Capital and reserves
Called up share capital 3,396 3,551
Capital redemption reserve 1,015 860
Share premium 348 348
Capital reserve - unrealised (4,076) (1,730)
Capital reserve - realised 6,093 6,049
Revenue reserve 56 30
Equity shareholders' funds 6,832 9,108
Basic and diluted 50.3p 64.1p
net asset value per share
CASH FLOW STATEMENT
for the year ended 31 March 2008
Year ended Year ended
31 March 2008 31 March 2007
£'000 £'000 £'000 £'000
Net cash outflow from (88) (150)
operating activities
Capital expenditure
Purchase of investments (2,438) (231)
Sale of investments 2,044 3,106
Net cash (outflow)/inflow (394) 2,875
from capital expenditure
Equity distributions paid (276) (287)
Net cash (outflow)/ (758) 2,438
inflow before financing
Financing
Purchase of own shares (436) (1,332)
Net cash outflow from financing (436) (1,332)
(Decrease)/increase (1,194) 1,106
in cash in the year
NOTES
1. The financial information has been prepared in accordance
with the accounting policies set out in the statutory accounts for
the year ended 31 March 2007 which are also adopted for the year
ended 31 March 2008 and has been prepared under UK Generally Accepted
Accounting Practice ("UK GAAP") and in accordance with the Statement
of Recommended Practice "Financial Statements of Investment Trust
Companies" revised December 2005 ("SORP").
2. Return per share
Revenue return per ordinary share is based on the net revenue return
after taxation of £26,000 (2007: £18,000) in respect of 14,003,193
ordinary shares (2007: 15,229,480), being the weighted average number
of ordinary shares in issue during the year.
Capital return per ordinary share is based on the net capital loss
for the financial year of £1,680,000 (2007: £804,000) in respect of
14,003,193 ordinary shares (2007: 15,229,480), being the weighted
average number of ordinary shares in issue during the year.
As the Company has not issued any convertible securities or share
options, there is no dilutive effect on return per ordinary share.
The return per share disclosed therefore represents both basic and
diluted return per ordinary share.
3. Net asset value per Ordinary share
Net asset value per ordinary share is based on net assets at the
year-end, and on 13,586,073 ordinary shares (2007: 14,203,875), being
the number of ordinary shares in issue at the year-end.
As the Company has not issued any convertible securities or share
options, there is no dilutive effect on net asset value per ordinary
share. The net asset value per share disclosed therefore represents
both basic and diluted net asset value per ordinary share.
4. Principal risks and uncertainties
The Board has reviewed the principal risks and uncertainties facing
the Company over the remainder of the financial period and concluded
that the key risks are:
* investment risk associated with investing in small and
immature businesses; and
* failure to maintain approval as a VCT.
In both cases the Board is satisfied with the Company's approach to
these risks. The Board takes into consideration information
regarding the potential investment companies, the board of directors
and the related sector before taking the decision to invest. The
Company also continually monitors its compliance with the VCT
regulations and retains PricewaterhouseCoopers to provide regular
reviews and advice in this area.
Statement under the Disclosure & Transparency Rules 4.1.12
The Disclosure and Transparency Rules ("DTR") of the UK Listing
Authority require the Directors to confirm their responsibilities in
relation to the preparation and publication of the Report and
Accounts.
The Directors confirm that, to the best of their knowledge:
* the financial statements, prepared in accordance with
applicable accounting standards give a true and fair view of the
assets, liabilities, financial position and profit of the Trust;
* the Annul Report includes a fair view of the development
and performance of the business and the position of the Trust
together with a description of the principal risks and
uncertainties that it faces.
Announcement based on audited accounts
The financial information set out in this announcement does not
constitute the Company's statutory financial statements in accordance
with section 434 Companies Act 2006 for the year ended 31 March 2008,
but has been extracted from the statutory financial statements for
the year ended 31 March 2008, which were approved by the Board of
Directors on 25 July 2008 and will be delivered to the Registrar of
Companies following the Company's Annual General Meeting. The
Independent Auditor's Report on those financial statements was
unqualified and did not contain any emphasis of matter nor statements
under s 498(2) and (3) of the Companies Act 2006.
The statutory accounts for the year ended 31 March 2007 have been
delivered to the Registrar of Companies and received an Independent
Auditors report which was unqualified and did not contain any
emphasis of matter nor statements under S237(2) or (3) of the
Companies Act 1985.
A copy of the full annual report and financial statements for the
year ended 31 March 2008 will be printed and posted to shareholders
shortly. Copies will also be available to the public at the
registered office of the Company at Kings Scholars House, 230
Vauxhall Bridge Road, London SW1V 1AU and will be available for
download from www.downing.co.uk.
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